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[December 2006]
Morgan Crucible Issues Trading Update
The Morgan Crucible Company PLC, the specialist materials company, has issued its pre-close trading update ahead of its 2006 full year results to be announced on 20 February 2007.
The momentum in group profit margins has continued into the second half of the year with underlying operating profit margins before restructuring and one-off costs expected to approach 11% for the full year.
2006 like-for-like sales growth from continuing businesses has remained robust and is forecast to be over 7% for the year on a constant currency basis. The weakness of the US dollar in the second half of the year will negatively impact the group's sterling reported numbers compared to 2005.
The three-year profit improvement plan is now drawing to a close having achieved double digit operating profit margins well ahead of schedule.
The balance sheet remains very healthy with negligible levels of net debt giving the scope to invest in profitable growth both organically and through appropriate bolt-on acquisitions
Given this financial strength, the group said it was pleased to announce that it would be initiating an ongoing share buyback programme of up to £50m to improve balance sheet efficiency
Commenting on the results, Mark Robertshaw, Chief Executive, said: "Our 2006 results will continue to reflect the ongoing improvements that we are making in our business and to the quality of our earnings stream. Our strategy remains to focus on higher margin, higher growth, higher value-added products and markets and to continue to move away from more commoditised and cyclical market segments. In parallel we will continue to drive down our cost base as we further rationalise our manufacturing footprint and increase our proportion of manufacturing in low-cost locations. The successful delivery of our profit improvement plan and our robust balance sheet puts Morgan in a strong position to continue to target mid-teen margins. As a result, the Board looks to the future with confidence".
www.morgancrucible.com
ENDS